Ted Sarandos interview started with the question: “Have you destroyed Hollywood?”

“No, we’re saving Hollywood,” the Netflix co-CEO replied with a smile.

On Wednesday in New York, Sarandos engaged in discussion with Time magazine editor-in-chief Sam Jacobs at the Time100 Summit.

The two jumped right into the problems plaguing Hollywood and why Netflix is succeeding amidst production decreases, dwindling box office numbers and an industry in contraction.

Using the struggling global box office as an example, Sarandos added, “What does that say? What is the consumer trying to tell us? That they’d like to watch movies at home, thank you. The studios and the theaters are duking it out over trying to preserve this 45-day window that is completely out of step with the consumer experience of just loving a movie.”

Netflix is not entirely removed from the movie theater business, as the company owns Los Angeles’ Bay Theater and New York’s Paris Theater, which Sarandos says Netflix “saved” from becoming a Walgreens: “We didn’t save it to save the theater business. We saved it to save the theater experience.”

“We have these bespoke releases … we have to do some qualification for the Oscars,” Sarandos said. “They have to run for a little bit, it helps with the press cycle a little bit. But I’ve tried to encourage every director we work with to focus on the consumer, focus on the fans. Make a movie that they love, and they will reward you.”

Sarandos also noted that “we’re in a period of transition,” saying, “Folks grew up thinking, ‘I want to make movies on a gigantic screen and have strangers watch them [and to have them] play in the theater for two months and people cry and sold-out shows … It’s an outdated concept.”

Asked specifically if the desire of filmmakers wanting to make movies “for movie theaters, for the communal experience” is “an outmoded idea,” Sarandos said, “I think it is — for most people, not for everybody. If you’re fortunate to live enough in Manhattan, and you can walk to a multiplex and see a movie, that’s fantastic. Most of the country cannot.”

He warned Hollywood not to get “trapped” behind wanting audiences to see movies in theaters because that’s how the film industry wants audiences to watch them. Instead, for the sake of the entertainment business, Hollywood should adapt to the way in which audiences want to watch movies, Sarandos argued.